We take our nonpartisan public mission seriously. We do our best to highlight the threats to full employment, what public policy can do to achieve full employment, and the full suite of benefits that can flow from full employment. We'll have more to say in the coming months about where Employ America is headed, but those efforts are going to be pursued regardless of how the results of today's election pan out. While electoral politics inevitably shapes the scope of economic policy , our commitment to a full employment economy and the macroeconomic policies that underlie it remain unchanged.

Employ America was founded in 2019 on the understanding that macroeconomic policies are critical to achieving and sustaining strong labor market outcomes. Full employment should be the norm, and yet for so many decades, it was an extraordinary outcome. Since that time, we've seen, despite a historic pandemic-induced recession intervening, a historically strong period of labor market outcomes, and avoided the permanent scars that previous recessions inflicted.

On the benchmarks we most consistently use to evaluate the labor market, we have much to be grateful for. Although they can achieve higher heights over time, prime-age employment rates are historically high and have surpassed the peaks of the prior two recessions. Bargaining power has diffused to more workers. While real wages went through a painful downswing due to inflationary supply shocks, we are now seeing sustained gains there as well.

It is also not lost on us that there is still plenty of economic frustration. Inflation has fallen, but it is not yet back to the Fed's objectives. Independent of the Fed's objectives, there is a more direct frustration with the high level of prices, the abruptness of recent price spikes, and the volatile and uncertain trajectory of real incomes. We fully recognize that the Fed has a Congressionally mandated role to support stable prices, but interest rate hikes are also a blunt and indirect approach to addressing inflation and the frustration it causes. To limit the collateral damage risks that interest rate hikes can impose on employment and investment over the longer run, a broader set of policies are needed to address cost-of-living challenges seriously. 

From here, our policy and economic objectives will remain the same no matter what Congress and the White House look like after today:

  1. Defending and building upon the current set of labor market gains. The full suite of benefits to full employment are starting to accumulate, for workers’ welfare, for equity, and for productivity. With the benefit of further time and accumulation, we expect more scholars and policymakers to take a richer understanding of how full employment can support economic outcomes that are more equitable and more productive. The worst thing for American workers right now would be a labor market downturn. We would like to see high employment and strong growth persist and, to the extent feasible, avoid backsliding.
  2. Developing a more robust anti-inflationary policy toolkit. Inflation has, both in direct and indirect ways, depressed how Americans experience economic outcomes and feel about it. The last few years have highlighted the need for a more robust policy toolkit to proactively and reactively manage inflationary dynamics. In the absence of such a toolkit, full employment outcomes will remain structurally vulnerable to a range of inflationary shocks, and their legitimacy easily undermined.
  3. Accelerating investment and productivity. As our more recent commentary and analysis of productivity highlights, we see a stronger overlap between full employment outcomes and those typically associated with prosperity and efficiency. Efforts to crowd-in investment can support stronger labor demand and high-quality jobs, while also raising labor productivity, wages, and overall resilience.

We see a solid labor market right now, a foundation for achieving more equitable and productive economic outcomes. At the same time, the inflationary shocks and supply-side vulnerabilities of the past few years also demonstrate serious gaps in addressing and managing key macro risks.

We hope that the next slate of lawmakers and policymakers, no matter their partisan affiliation, see that recent labor market gains are worth building upon, and do their part to enact policies that directly address inflationary challenges and cost-of-living frustrations.